Don't miss our brand new virtual event happening this Tuesday. I'm sharing my personal playbook on investing and real estate. Get your tickets@ramsaysolutions.com. events live from the headquarters of Ramsey Solutions, it's the Ramsey show. We help people build wealth, do work that they love, and create actual amazing relationships. Thank you for joining us, America. The phone number is 888-825-5225 Ken Coleman, Ramsey personality number one best selling author and also author of the best seller, newly minted bestseller, find the work you're wired to do. Just hit the best seller list, boys and girls. So congratulations, Ken.

Thank you, sir.

Very cool. Thank you. You can hear him on the Ken Coleman show on the Ramsey networks as well. So we're glad you guys are with us today. We're here to help. Triple 888-25-5225 Dexter is in Philadelphia. Hi, Dexter. How are you?

Good.

How you doing today, guys?

Better than I deserve. What's up?

Awesome, awesome. Very good. Long time listener here and really appreciate the show and how you guys really help a lot of people and things like that. I have, under circumstances, I met a very beautiful woman who I plan to be with for the rest of my life. And we're dealing with a situation where she is trying to basically get visitation for her daughter. And she has been under a lot of financial stress. And apparently I've been trying to do a lot to help with the circumstances, a lot of lawyer fees. The gentleman she had been married to is a very hostile. I believe he is sort of has a condition or something. I guess it's more of a controlling, control person. And so I'm trying to do a lot of things to help them finance. And I just bought a home myself, and I have paid pretty much for the home, and I'm renovating, and it's taken a lot of my finances out. I have four months to try to get moved in, but I have a lot of financials to re renovate the place, so I'm kind of doing it on my own. So due to conditions, the girl I'm dating is actually trying to get visitation to her daughter, and he won't allow her to see her daughter.

And she had the cops come out to try and visitation to have visitation, and she just. He won't allow her to see her daughter. And he's controlling the daughter by buying gifts and doing a lot of things to control the relationship of, you know, of that situation.

So I got you. Okay, so you're dating a hot mess.

Yes.

Yeah.

Yes.

No doubt okay, how can we help?

I'm trying to figure out. She. She doesn't want me to help her. Somewhat financial. She's really, like, saying, look, I got this. This is my, you know, she's, you know, stating that don't get involved or don't, you know, try not to. And so I'm helping out. She's also helping me write a media play. So then I try to, you know, help her with other things and do things to. Whatever I can do. She allowed me to help with. And she's in a situation where all her finances are into a lawyer who is fighting, so she can just get visitation, and she's basically in debt with her family because her family's giving her money to help out with the situation.

What does she make a year?

She makes probably, I want to say, maybe 50,000 a year. 55,000.

Okay. All right. So you still not ask a question, but I'll just go ahead and give you a comment or two. Okay. Okay. Number one, do not contribute money to someone's situation that you are not married to.

Yes.

If you're married, it's now your problem. If you're not married, you can cheer, you can be a shoulder to cry on. You can be angry with her, you can participate emotionally and relationally in her fight and so forth, but do not transfer money. You're going to change the tone of your relationship if you do, and you're going to regret it later. Do not pay her bills when you are not married to her under any circumstances, period. I've been doing this a long time. 100% of the time, people do this. They wish they didn't for one reason or another. It always bites you later in the butt. Don't do that. Okay.

That's very. It's a true statement.

Yes. Now then, on top. But. But I want you to be supportive for her. She's obviously going through a hard time. You're obviously emotionally invested, and that's cool. I got no issue with that at all. Have at it. You're supporting somebody you care about, and they're going through a hard time. Do it. That's how what good people do. You're a good man. As far as your house goes, you just bought a house. You got to renovate, okay? And if you didn't have the money to the renovation, you shouldn't bought a house that needed renovation. So you need to step in there and get that sucker done and get moved into it. But again, that's got nothing to do with her finances. It's as if you told me two different stories.

Sure.

You have the story of the house, which is completely independent of the story of her, except the part where she's helping you sweep and do some of the renovation or whatever. She. Maybe she's swinging a hammer and hanging drywall. I don't know what she's doing. But. But you know, that part, there's a little bit of overlap, but the rest of these are two separate stories, and they need to remain two separate stories.

Yes, true.

Okay.

And so. And I think what you're. What you're struggling with is you. You've fallen for her, which is not a bad thing. I'm not saying she's not worthy of that, but. But you're. And so you're starting to want to treat this like a marriage situation before it is. And I'm telling you, when it's a marriage situation, you're all in, buddy. You signed up for the trip, you take the trip. But until then. Until then, you're just a supportive boyfriend.

Yeah. And I just add Dexter. Dave's 100% right. So don't think that the out here is to go ahead and make the marriage happen, because I could hear it all over yourself, your voice. She said she didn't need help. It's my mess. But I could hear the but coming. And I think you need to wait. This thing needs to resolve itself before you guys get married. That's just my opinion. But don't think all of a sudden that what Dave said is. Well, the asterisk is, if I marry her now, now I can jump into this. And I think you've got financial troubles. You're not clear as you need to be financially, with some margin. So you're just going to have to wait this thing out.

Yeah. Get the house renovated, get the visitation settled, and then you're both dealing from strength, not weakness, to build a quality relationship. And I think doctor John Deloney, where he's sitting here, we'll just channel our. Our own inner doctor Deloney. I like channeling any inner doctor stuff. Cause I don't have a doctor. So there you go. I have a doctor, but I am not a doctor.

Does that mean we have to take the same medication he does?

I hope not. I wouldn't want to have those.

I don't have any tattoos or anything.

I wouldn't want to have that twitch.

If I do this, I look silly. He looks cool when he does it. But I think you're right. I mean, I think we got to be careful here. Let's get through this time.

Yeah. Deal in relationships from strength and you don't make yourself, you don't make yourself better when you're hurting by marrying someone that just brought your hurt into the marriage is all it does. Or your battle or your God help you. A house renovation? I'm not sure which one I'd rather have. This is the Ramsey show.

This show is sponsored by Better help. Hey, it's doctor John Deloney. One of the most common questions I get is how to get something off your chest, maybe something that happened to you, something somebody said to you or something youve done that youre worried about because bringing it to light will disrupt your entire life. Getting things off your chest is important, but its hard to know where to start. Therapy can be a safe, effective place to get things off your chest, to learn how to say hard things out loud, and to figure out how to work through whatever is weighing you down. I've been blessed to have a great therapist who helps me get those heavy things off my chest. So if you're thinking of starting therapy, give betterhelp a try. It's flexible because it's online, so you can suit it to fit your schedule. You just fill out a short questionnaire to get matched with a licensed therapist, and you can switch therapists at any time for no extra cost. Get things off your chest with betterhelp. Visit betterhelp.com deloney today to get 10% off your first month. That's betterhelp help.com deloney.

Ken Coleman Ramsey, personality, is my co host today. Thank you for joining us, America. We're so glad you are here. Well, graduation season is here, and so the goods are here for the graduates. Ken's brand new bestseller, find the work you're wired to do, which includes the famous get clear assessment. And you get an assessment code built into it. Almost 100,000 folks have bought the assessment and taken it online@ramsaysolutions.com. dot now you get the book that tells you how to read and go through the results and how to apply the results. That's a great gift for a graduate. Breaking free from broke by George Camel. Speaking the language of that generation that just of you generations that just graduated, whether it be high school or college, this book is fabulous. More research and detailed research on what's going on in the marketplace with money right now. It'll blow your mind. Some of the stuff some of these companies are doing to you and George unveils all of it. And the 20th anniversary edition just came out of the total money makeover. Over 10 million copies sold. That means over 10 million people have gotten a total money makeover.

Been a graduate gift for a long, long time. You can get these graduate gifts at Ramsey solutions.com in the store, and it's probably the best thing you could do. Be better than, you know, giving them some lame o graduate gift. Although. Although some kids might think a book is a lame o graduate gift, but. But it's not. This is a. This is a book with life changing material in it, all three of these. So be sure and check them out. Jeff's in Madison, Wisconsin. Hi, Jeff. Welcome to the Ramsey show.

Hey, Dave. How's it going?

Better than I deserve, sir. What's up in your world?

Not a whole lot. Oh. I have a unique situation right now. Me and my wife, we started or created and started a spray foam business, and we are in the. We have the opportunity right now to actually sell out our business. Quick background on us is my wife. She's a stay at home mom. She's a homeschool teacher. Um, we live out in the middle of nowhere and kind of.

Out in the middle of nowhere where there's no phone reception. Yeah, just as you said that your phone cut out. That's so perfect. Yeah. Are you. Are you back with me?

Yeah, I'm here. Are you there?

Yeah, sorta. Okay. So you got a spray foam business. Somebody's offering to buy it. Tell me about it.

Yeah.

So it generates about $175 to $1,000 a year. We run out of about a 58% to 60% profit margin. And we're just trying to figure out. We're not, you know, a business kind of people. So we're just trying to figure out what we need to do. We're trying to figure out the value of the business, how to structure the sale of the business, and what to do with the money after we get the money.

Okay. Who's offering to buy it?

Another guy, another contractor, who actually just recently purchased another spray foam business. So he kind of wants to, I guess, control the market and keep his employees busy five days a week nonstop. So that's kind of what his objectives are made.

When you say you made a 60% margin on 200,000, that's $120,000 profit. But that. Does that include paying you?

So we generally don't really take a salary. We kind of, like, pay our bills, and then.

Yeah. Are you working in the business leFt?

We kind. Yeah, we kind of just hold on to it.

So if I were gonna buy the business, I'd have to hire somebody to do what you do? Because I'm not gonna spray the phone.

EaSy.

Right. So, I'm trying to put a value on the business. So the value of the business is the net profit after every piece of labor has been paid. And you haven't paid yourself labor out of that 120. So if I hired someone to do what you do for your business, I might have to pay them 60 grand, right?

Yep. About that. Yep.

Okay. Which means we might make 50 or 60 grand net profit on your business. Does that sound about right?

Yep. Sounds about right? Yep.

And what's the guy offering you for your spray foam business? We're.

We're figuring right around $135,000.

LITTLE Low.

LITTLE Low.

Yeah. So if you. If you may. If you net 50,000 on it. OKAY.

Yeah.

And. And I want to make 25% rate of return on my moneY. I would pay 200,000 for the business.

REALLY?

And I would make 25% on my money. Invest 200,000, make 50. That's 25%. You follow me?

That's pretty. That's right. It's liKe, kind of playing the stock market. If you had 25%.

Yeah, 25%. It's a good rate of return on a small business, which is Higher risk than the stock market. Okay.

Right, exactly.

So, your business, if you. If you only wanted to make 20% on your money, then your business is worth 250,000.

Right. I see what you're saying.

So, your business is worth more than 135.

Interesting. Okay, well, that's good to know. So, then how we. How would that be structured, since, like I said, we're not into the cash.

Yeah.

Okay. Just straight up, no. No loans or anything like that.

So if you can get 135 to 150 cash and walk away and you're smiling and you're happy and you're glad you did it, that's probably okay. It's probably okay. It's a little low, but it's cash on the barrel head. The guy has to go scratch the money together from somewhere. Then you. You may have sold it a little cheap, but you got your money all up front. You're done, no questions asked. Everything's over.

Okay. All right. And then, so, with that money, you know, we do have some bills that we'd like to pay. Is there anything specific that you would suggest that we should do? Pay our bills off first and then worry about saving for the future.

Yes.

What do you think?

Yeah. We recommend getting out of debt, which is baby step two. How much debt do you have, not counting your house?

Well, that's kind of the interesting thing. So we own 92 acres, and we built a house, so we bought some property, I want to say, in 2018, and we paid about $3,500 an acre. Right now. The value of that lands, probably about. Around our area, is about $8,500 an acre. So the.

That's your. That's where you live?

Yeah.

Okay. I have. Not counting where you live.

Okay. Then we would probably be sitting at about 72,000.

Okay. First thing we do is clear all that, and then you raise your right hand and never borrow money again.

Yeah, exactly.

What are you gonna do for. What are you gonna do for a living after you sell this?

So, that's the other side of our businesses. We run a trucking company as well.

What company?

I'm gonna hop a trucking company.

Okay. All right.

So I'm gonna hop that. Do that as well.

Did you say hop back in the truck?

Yeah, I'm gonna start driving again.

Okay. So what are you gonna be making?

The gross on that is usually about 215. Before. Before everything.

Okay.

All right.

So you're gonna walk our baby steps out. Baby step three is the three to six months of expenses after you pay that debt off. So if you clear 150, all of that is basically not all of it, but most of it's spoken for, right?

Yeah. You're gonna pay taxes on it. You're gonna pay taxes on it. You gotta set that aside, and then you've got to. You clear up the 70, and you put some money aside for an emergency fund, and a lot of that money is gone then. Okay. And then after that, we take the fact that we don't have any payments anymore. You now have control of your most powerful wealth building tool, which is your income. And you use that to invest for your future, to invest for retirement and a kid's college, and start talking about paying off that piece of land that you were beginning to tell me about. And that's the direction that you go. So. Good question, Dave.

I was going to follow up. I think this would be interesting for small business people that are thinking about selling a business. I was running through the numbers. As you were walking. Was this. Was it Jeff? Jeff, through that, were you working out about a three to five times net profit?

Is that what you were working on? 25%. 25% is four times.

Right. That's what I was saying.

20% is five times.

It's somewhere in that range for a small business.

Or is that across the board a small business? I mean, because you've got a high risk. The thing that people in a business of that size that's making under a million dollars a year, they very seldom take their cost out. So you always have to remove that to get to a true net. And you treat it like an absentee investor. Like, if I was going to buy that spray foam business, I live in Nashville, I got to hire somebody to run it in Madison, Wisconsin, right now. That tells me what the business is truly netting net net what? And then that tells me what my return on investment, my cash on cash return is. And that's a good general rule of thumb, Dave. Nobody gets 25% on their money. In small business. You do every day, honey. But you work your butt off, and there's a lot of risk involved that you don't have buying a mutual fund, okay? It's a completely different setup than a mutual fund. So, yeah, I make 25% of my money all the time at Ramsey. If I don't, I'm probably not going to stay in business. This is the Ramsey show.

Hey, listen up. Everyone is at risk of identity theft. I don't care if you're a hermit living off the grid, listening to the show on a battery powered radio. All of your data collected by every company you've ever done business with lives online. Your bank, your doctor's office retailers, the apps on your phone, the gas station where you have loyalty rewards. They all store your info online, making them ripe for a cyber attack or data breach. That's why I've been telling people for almost 25 years they need an id theft protection plan. And the only one I've ever recommended is from Zander insurance. They monitor your personal and financial info, even your home title, and take over the work if you become a victim. It's the most thorough and affordable plan out there. I even have it for my family and our entire team. Visit zander.com or call 803 564282. Thank you for joining us, America. We're glad you're here. Open phones at 888-25-5225 Ken Coleman Ramsey, personality number one best selling author is my co host today. If you like what you're hearing, we could use your help. We would appreciate you clicking the follow button and following the show or subscribe button subscribing to the show, depending on the format you're in.

Thank you for doing that. Please share the show. Tell people where you listen to us on talk radio or what podcast, or if you got a share button on the platform you're on. Just click share and share it. Let people know we're here. I know, a lot of you are doing that because our numbers are way up. Thank you. Thank you for telling people about the show. You are our best marketing and we appreciate you very, very much doing that. So please, and leave those nice five star reviews. They're very helpful. Zach is in Oklahoma City, Oklahoma. Hi, Zach. How are you?

I doing good.

How are you? Better than we deserve, sir. How can we help?

Well, my wife and I were talking last night and we were wondering if we should pause baby step two to purchase a storm shelter since we do live in Oklahoma.

How long have you lived in Oklahoma?

Myself, 31 years, and my wife about four years.

Okay. And so why all of a sudden last night are we afraid about tornadoes? They've been there the whole time.

They have.

And it wasn't something that happened last night. But I'm an ag teacher in spring is my busy season and, you know, I've got a wife and year and a half old daughter now. And one night I was gone, had kids at speech contest and a storm starts headed right for the house. Tornado gets put on the ground and my wife and kids only real option was to drive 5 miles into town to her classroom, which is a storm shelter. So I guess that kind of got me, kind of scared the daylights out of me and got me thinking about it.

Okay.

How much would a storm shelter be?

About 4000.

Mm hmm. And what's your household income after taxes?

70,000.

Okay. So how long does it take you to save up and build a storm shelter? If you push pause and do this?

Two, possibly three months.

Two. Okay. Well, it's, you know, the principle that we use is if you are, if your car broke down, okay, then. And you don't have the money to fix it because you would have paid down everything down to a, you need 2000 or $4,000 to fix a car or replace a car, you would have to push pause because you're in the middle of an emergency. Okay.

Yeah.

Emotionally, after the scare with a one and a half year old, your brain is in an emergency. And I can understand that. Okay. If that had been my little kid, that would have done it. But you and I both know that statistically you've lived there 31 years and haven't been hit by a tornado. They're all around you. You can see them out there dancing in Oklahoma. I know, I understand. And they put on quite a show sometimes. And sometimes they hurt people and tear up. Jack, I'm not questioning that. Okay? But statistically, tornadoes are way different than hurricanes because it's one finger. It's one finger on the ground versus the entire city gets wiped out. Okay. And I'm just talking about the actual data, not the emotion and the fear around it. Okay. And so, statistically, you're probably okay to get out of debt and then do this, but. But I don't know if, psychologically, you're going to be. So you got to. In order to stop your baby. Step two, you have to declare this an emergency.

Yeah.

Emotionally, I could probably do that. Statistically, I can't.

Yeah.

Does that make sense to you?

Yeah, it does. And I think. I'm just thinking about it more of a peace of mind.

Yeah.

It's exactly what it is compared to the debt side.

So, Zach, let me challenge you. If I were you, how long would.

It take you to get out of how much debt you got left? I'm sorry, Ken.

That's all right.

We've got 14,600 left on a car, and that is it, besides the house.

All right?

So, Zach, if I were you, I would not pause the baby steps. I would find a way to come up with the four grand as quick as I possibly could, work an extra hours selling anything and everything, you know? Four grand.

You.

You can find a way, is my guess, pretty quick.

What does your wife do for a living?

She's also a teacher.

Okay. So I think both of you pick up some tutoring. And here's the thing. What we're talking about here is whether it's. We're not talking about whether or not to do a storm shelter. What we're talking about is if you. If you're paying off debt at the rate of $2,000 a month, you're done in seven months, and in two more months, nine months from today, you. You're 100% debt free and you have a storm shelter. Okay?

Yeah.

Or you do the storm shelter first, and nine months from today, you're 100% debt free and you have a storm shelter. So the only thing we're discussing is whether we put it on the front or the back of the debt snowball.

Yeah.

And in the middle of that discussion, we might change those number of months by increasing your income.

Yeah.

So that's really the discussion. So do you want to mess with. You know, can you deal with the emotions of this for seven months and so forth? And I've got a bad track record on this, so I really am uncomfortable telling you to do something. I'm gonna say, you know, if I'm in your shoes, the principle is, in order to put it in front of getting out of debt, you have to declare this an emergency. And after getting the crud scared out of you with a one and a half year old, I'm not gonna be mad at you if you declare an emergency. Okay? But I'm gonna put with that the actual statistical discussion. But I'm the guy who. What? 2020 march. Remember that? Oh, yeah. Yeah. I'm on the air. I canceled schools in our county tomorrow, the next day, because a storm might be coming that might have tornadoes in it, and they canceled school, and there's not. It's not. The sun is shining outside, and they cancel schools the next day. I'm the guy that went on the radio and made fun of that, and the next day, a tornado tore the hell out of Nashville.

I mean, hurt people and everything. And so, like, people are ripping me to shreds on the Internet, going, well, that didn't age well, Dave. I'm like, no, it didn't. So I don't make fun of tornadoes anymore after that. That was my last time. And nobody, you know, we had people in the workforce. We had three people workforce. Our house got blown down. And, I mean, it was. It was a bad tornado came through here, and. And that was right. Right as the pandemic was opening up. So it was a great march. You know, march of 20 was just an amazing month, but, yeah, so it didn't age well. But I still. I still, you know, I still love the generation that go, you cancel school because it might snow. You are a bunch of wusses. You are totally wussed out. And so I just. I don't get it. But I do get it. I get that the guy I would be scared to, my wife and one and a half year old had run to a. Had run 5 miles away to get away from it. I would be scared to. I get that.

Absolutely.

That actually happened. That was not a might happen tomorrow thing. And then I stepped in it up to my knees, but there you go. So. Oh, well.

And this is very doable. And he's being responsible about it. You know, he's asking the question, should I?

Pretty cool headed.

I think so.

Not in drama queen mode.

I think if I lived in Oklahoma, I think they call it Tornado Alley.

I could wrong on that, definitely.

And when is tornado season? Chill out.

I think they have an unfair advantage, though, over Nashville.

Oh, boy.

Because we can't see them. We got hills in Oklahoma. You can see it coming for 25 miles. You can just sit and watch it and go, oh, crap. It is actually coming here. You know, I mean, but here you just dropped.

I don't think anybody in Oklahoma sees that as a distinct advantage. But I get your point.

Well, we get a lot of tornadoes in Tennessee, but we do, actually, we don't get any hurricanes. And we do have some loud mouth talk radio people. So there's that.

I don't know any of those people personally. None.

There's a lot of wind involved in this discussion. I'm just saying. This is the Ramsey show. You know, it doesn't take a degree in statistics to realize this one stinks. 93% of undergraduate private student loans are cosigned. So when you're doing delinquent and drowning, mom or papa or Uncle Joe is stuck in that financial stress along with you. But there is a way out. Why Refi. Yrefi offers a custom refinancing option with a fixed rate loan based on your ability to pay. And the average interest rate Yrefi offers is 3.9%, which can significantly reduce your monthly payment and decrease your total cost. Contact Yrefi at Ramsey or go to yrefi.com ramsay. That's 8442 Ramsey. Or the letter Y. Then refy.com ramsey.

Why Refi is not licensed by the California Department of Financial Protection and Innovation. Why ReFi is not authorized by the New York State Department of Financial Services to service any New York loans. Funding may not be available in all states.

Ken Coleman Ramsey, personality number one best selling author, is my co host today. Thank you for joining us, America. Kevin is in Cheyenne, Wyoming. Hi, Kevin. Welcome to the Ramsey show.

Hi, Dave. Thank you for taking my call.

Sure. What's up?

So, I was just wondering, looking for a suggestion or a recommendation? I'm able to save, after taxes and 401k contributions, about $2,800 per month. And I was wondering what percentage of that remaining amount I should be investing in the market or stockpiling cash. And I have no other debts. My home's paid off.

Good for you.

I'm just not sure. I'm just not sure what to pay.

Well, you're 100% debt free. You have an emergency fund of three to six months of expenses, I assume.

I do.

Okay. And then you're putting. You're maxing out all your retirement to keep the government's hands off of as much of it as you can. If you're not, you're picking up. Okay. Excellent.

My roth. Four hundred one K. And Ira and HSa. All the letters, you know.

Wonderful. You're doing it. You're doing everything right, brother. Well, at this stage, we call it baby step seven. There's nothing left to do but build wealth and give. Basically, there are three things, Kevin, and you know this, but I'm going to say it out loud, that we can do with money. We can have fun with it. That's called lifestyle spending. We can invest it, which is what you're asking about. And we can be generous with it. You should always do all three. And so if to the extent your monthly budget before it nets out 21, 2800 does not do those things, I'm going to increase one of those categories a little bit. So if you're not having enough fun, are you married?

I am not.

Okay.

I'm single.

Okay. What's something really cool that you've been hesitating to do because you're a tight watt?

Well, I kind of went against your rule and I ended up buying a brand new car, even though I'm not quite at a million. But I did do that.

Okay. What'd you buy?

A hybrid Camry.

Okay. Ooh, it went all out. A Camry. Wow.

Because you had to save money on gas. Way to go.

That's right.

I can hear it.

If I can save $20 a month.

Yeah, it only cost me 50 grand to save $20 a month. This will work out.

It was cheaper than that. Don't worry. I shopped around.

Yeah, not much. All right. But, yeah, that's fun. Okay, I'm with you. So seriously, try to challenge yourself on your generosity bone and on your fun bone and, you know, build up those muscles, those two muscles, because you're. You're investing muscles really strong already.

Okay, so I'm investing enough.

Yeah, well, no, you can invest more, but I. But I. I'm not the guy that says, okay, put all 2800 into a good mutual fund. No, put all 2800 into a. Into a fund until you build up enough to pay cash for a piece of real estate. If that's what you want to do, that's okay. But I challenge people that have gotten to the level that you're at. You're almost a millionaire. How old are you?

35.

Way to go. You've done really good, man. I mean, you just really have done a great job. So I just challenge folks to make sure we have in the actual mathematics some balance between fun and generosity. So I have that formula. So last week I got a check from one of my publishers on one of my books. Okay. It's usually I get a big check from them. Ever so often, these books keep selling. Thank you, Lord. And so. Thank you people to keep buying them. Yeah. So I got a big royalty check. That check is already spent in those three buckets.

Okay?

Get additional giving, additional fun, and additional investing by percentage. I just apply those percentages to that check already gone. And so then when I go do something fun with the fun bucket, I have zero guilt. Zero question if I'm wise. Zero question if I've lost my christian spirituality. Although some moron on tick tock will have a. Have their opinion about that. But just the same.

Of course they will.

You know, you see, my point is, I'm not taking a poll on that anyway. But the point is, is I know that I've been wise in that I've touched these three main areas of life. And Sharon and I are going on a really great trip here in a couple of weeks. We spent a lot of money on it, but it's a very small percentage of our world overall. And it came out of the fun bucket. Shut up. You know, I mean, that's what we're doing. So it, you know, we're 63. We're gonna have some fun. So there you go. That's why we work. And. And simultaneously, there are some ministries. Got some really nice checks. Because we got a big check in. And that generosity piece goes out. Right. So you. It just keeps things flowing. If you've got some kind of a way to already allocate the money.

Yeah. And I would just add that it's really fun to give that money, too. Not just the fun bucket, but the give bucket is really, really fun. Dave has been talking about that for a long time. And he's absolutely right. There is. There's a real chemical reaction. A real healthy dose of endorphins. When you have worked hard for your money, you've been disciplined. And now you give it to help somebody else.

Lois is in Fort Lauderdale. Hi, Louis. How are you? Hey, Dave. Hey, Ken.

How you doing?

Better than we deserve. What's up?

Good. So my question for you is. I used to have a problem with some credit card debt. That I have completely cleared up.

Good.

Thank God. My question is, now that I have no credit card debt, I'm working on baby. Step three. Building up my emergency fund. I'm planning on purchasing a house once I get done with saving up and have my emergency fund. Is it a bad idea to close the credit cards that I don't use?

It's a bad idea to close them later. The sooner you can close them, the better. Because it takes about six months from having all accounts closed at zero activity for your credit score to disappear. And if you're going to buy a house, you either need a good credit score or a zero credit score. You don't need one in the middle.

Understood. So, yeah, I was worried about if I close them, it would have a negative impact on that credit.

It will temporarily, but. But over about a six month period of time. And you're six months away from buying. Yes, but if you wait four months and then you close them and then you're trying to buy it and there's stuff still showing up, it's going to drag your credit score down into the 600s, maybe, you know, and you don't want to do that. That's put you in this no man's land. So you want a zero, indeterminable, as they call it, credit score. And that comes from having no accounts open and no activity on no accounts open at all of any kind for six months. Then you'll qualify for a loan with a good company, like a Churchill mortgage, that we endorse with a zero credit score. That's what George Camel and his wife did. They bought a home, same interest rate that some goober with an 800 credit score would get exact same interest rate. And so. But you got to have a zero. I mean, you can't be in the middle. So you want to close them as fast as possible and be done with them forever and ever, which is your plan. The only reason you hadn't is you were worried about the house deal.

And this thing. This is the mythology, Ken. This guy's not falling toward it. But overall, people out there that believe the mythology about debt and what you guys have got to stop and think about is that debt is. We live today, at this moment. This moment, today in 2024, in the United States of America, we live in the most marketed to human race. Any time in history, more dollars and more sophistication are spent selling you stuff right now than at any time in history. And in the United States, we are the best at selling you stuff. You are impacted by marketing, sales, advertising, every time you take a breath. And the most marketed product in frequency and in dollars spent is debt. It's a product. That's how those banks have towers and you have a little bitty house. Their house. Their house is bigger than your house because you've been giving them money. Yours, it's the most marketed product in the history of the world at this moment. So you are. You guys are told so many lies about debt. You can't get a house without a credit score. All that debit card. It's not got the same fraud protections as a credit card.

Yes, it does. The exact same. Look at their website. Stupid. Wow. See, people believe these lies left and right. I'm gonna get rich on airline miles. Dave, you believe these stupid mythology lies? This is the Ramsey show, live from the headquarters of Ramsey Solutions. It's the Ramsey show, where we help people build what wealth, do work that they love, and create actual amazing relationships. Ken Coleman, Ramsey personality number one best selling author and my co host today. We're glad to have you open phones at triple 8825-5225 Felix is in Bangor, Maine. Hi, Felix. How are you?

I'm doing good. How are you doing?

Better than I deserve. What's up?

So I am 19, turning 20 this year. I am debt free, and I have a six month emergency fund saved up, and I'm looking to change my living situation.

Good for you.

Currently, I live with my fiance and her grandparents, exchanging work as well as pretty small amounts of living expenses for help. And in exchange, I get to live here practically rent free. So I have absolutely no free time. And when I'm out of work, I'm into chores. It's not sustainable. It's taking a toll on my mental health, and I'm just trying to get better. I currently have a tiny home that I am building on the land out back. I purchased a building and refurbished it so far to the point where I can start building. My family are all in the trades and have agreed to help me with some knowledge on building that home to make it better. However, I'm still stuck on the idea of whether or not it's a good idea to have this tiny home and move it onto some land or.

Oh, so you're, like, building it. You're building it portable right now? You're building it on a trailer or something so that you can move it and set it somewhere?

Yes, sir.

Okay. All right. Out back. And then I'm buying land. I wanted to make sure I understood what was going on. Okay.

Yeah.

All right, cool.

Yes.

All right. So what do you do for a living?

I'm currently a CNA. I'm also in college. All expenses paid for computer engineering.

Okay, good for you. Well done. So your question at 19 years old, and you're engaged to be married when?

This following summer.

Good. Okay. Your question is whether to finish the tiny home and buy some land and plop it on that or buy a house.

Yes, sir.

Buy a house.

I money.

Answer the question. Huh?

The thing is, I hate owing money. I really do.

Okay.

And all the houses in the area are just awfully expensive. Seeing those six numbers and thinking I'm gonna have to owe, that kills me, you know?

Mm hmm. That's fair. And, you know, renting is an option, too. But the. So here's the thing. The tiny house. The problem with the tiny house movement is that it's tiny. There's not a lot of people doing this, okay? There's a lot of discussion. There's a few loudmouths on the Internet, but 98, 99% of the public are not interested in a tiny house when you get ready to sell it. Consequently, basic supply demand economics tells us that where there is very little demand, there is very little price increase. So the tiny house is not going to appreciate dollar for dollar as much as a traditional property will. Now, the dirt that's under it might, and it might fool you into thinking that the tiny house idea was a good idea. But the tiny house, in and of itself, there's not a lot of demand, and so there's not going to be a lot of appreciation. The only thing it does do is it provides shelter. Very little, but shelter.

Do you have enough cash to buy this land you're talking about, since you hate debt so much?

No, sir. I was planning on getting a loan.

And so what's the difference in a land loan and a house loan?

Well, sir, five years.

The amount.

Yeah.

Five years in the amount. Yes, sir.

Okay.

Also, the credit required.

Okay. All right. Well, it is not going to ruin the rest of your life to do any of these three options. Rent, do the tiny house with some land, or buy a home. The thing that I think that will first, that will fastest advance you to where when you're 39, which. Which one of these three choices will get you the furthest ahead? Renting for three years inexpensively and piling up cash will get you to where you want to go faster at 19 years old than buying a tiny. Buying a tiny land, dying a piece of land, and putting a tiny house on it, or buying a house when you're, you know, just when you're in college, still when you haven't started your career, still, you're just getting to the game too early. And if I were you, I would just be caught, be content, and just rent something and start your life off with your fiance and work your tail end off. You're not afraid of work. You're a good thinker. You're thinking about ideas all the time. That's good. The only thing I would add to your equation to make you prosperous is patience.

Yes, sir.

Yeah. Felix, you're a go getter, man.

If you could rent like, a garage apartment somewhere and keep your cost really, really low.

That's what he's doing now, except he has to work.

Well, he's an indentured servant, essentially, is what's really happening here. Look that up, Felix. You'll understand that. But the point is, is that Dave's right. Something super, super cheap because you've got the income and you've got the discipline. I would go that route, too, and just wait until you get out of school, get that big job, and get on the ladder and climb it. I think you're going to be better off.

Yeah. The only appeal for you of the tiny house is price. That's the only thing that's drawing you to it. Now, you've already got it under construction. I would think you finish it up and sell it and load it on a trailer. Reload it on your little trailer and take it over to somebody's little place and. And set that little thing down there and sell it and make you a little money on it, man. If you want to go do that again, that'd be okay with me. That sounds like a good side hustle, building tiny houses and selling them to people if you want to. But in terms of, is a tiny house a equivalent investment to buying a home? Not even close. Not even close. Because the demand for them is very low. In reality. There's a lot of discussion and a lot of hot air around it, but that's a lot different than putting it on the market with a little for sale sign and having six people run up to buy it.

And let's not forget here for a moment, Felix. Dave and I have been married a long time each. We haven't been married to each other, let's be clear on that one. But married a long time to our wives. And here's the deal. What I can tell you the first year of marriage, and the data will tell you it's really hard. And I can't imagine the first year of marriage in a teeny tiny house.

Where you literally sounds like a. It just bad Aesop's fable.

It does. I just, woo. Need some space from each other, and there's no space in those things.

Yeah, you would. By definition, they're tiny. Yeah.

Sheesh. Have you seen any of these reality shows where people actually live in these things? It all seems really cool until the camera.

The only thing I'm sure about reality shows is it has nothing to do with reality. This is the Ramsey show. We all need health insurance, but how do you choose? Benefits vary a lot and the cost can be surprising. Health Trust Financial is the only company Ramsey recommends to find you the right health insurance at the best possible price. Health Trust financial is reliable, which is why I've trusted them for over 20 years. For you, not the insurance company, visit Health Trust Financial.com today. Health Trust Financial.com Dot Ken Coleman Ramsey, personality, is my co host today. Our question of the day comes from Adam in Wisconsin.

My 24 year old son has a mentor that wants to hire him while he builds a new business. He will teach my son e commerce, sales and ways to start a business. The mentor is quite successful and is excited about teaching him how to be successful in this field. Because the business is so new, my son will not be getting paid for six months to a year, hopefully sooner, but no guarantee should my son quit his current job where he makes close to $45,000 a year to join this adventure for the potential of a six figure income and future opportunities from what he will learn. He currently lives with us and he has no bills except for covering his car insurance. Well, Adam, I'm going to tell you what I would tell my son. If my son came home and asked me if he should do this, I'd say, absolutely not. I don't understand why this mentor, who is supposedly very successful and excited about teaching a young man, is going to ask him to come on for free. For free. Something doesn't add up. The successful people that I know smells like a scam.

Free labor. And I think this is silly. And so I would call the guys bluff and I think you're probably going to find out that it is just in fact that it's a bluff. And I would tell him, no, you're not doing that. Yeah, I don't have much more to add to that. I just. It doesn't make any sense to me.

If I took on the role of a 24 year old and I was the mentor, I could not ask them to work for free. I agree. That would turn my stomach up into my throat. Now, if you want to offer him a job making what he's making now, which is not much, 45 while you're startup, and you'll mentor him and teach him stuff, fine. But so I think you not only don't take the job, you disengage from the in air quotes mentor. Yeah, because I'm not sure he's a real one.

Well, he's not. Not the way you and I define it for sure.

Yeah. I mean, I would never mentor someone with the point of making them my indentured servant.

Yeah. That's what this is. For real?

Yeah. Yeah. That's not the idea. It would be kind of the other way. As an act of honor, I would want to overpay someone I was mentoring, not underpay them or give them a.

Real opportunity through a commission structure where they get what they make. You know, they get a big portion of what they make. So that's different than this. This is a weird, wacky, feels very manipulative, gross.

And I'm just not buying the quite successful part.

No, no.

I just don't. I don't. I could be wrong. I mean, maybe. Maybe he just has a different way of looking at the world than we do, and he's. Maybe he's worth millions of dollars and. And he is quite successful, but he just wants to teach those young people a lesson. I don't know. I don't know what the deal is there, but. Nah, I'm with you. The way we answer questions on this show is, if this was my son, what would I tell him? Run.

Yeah.

From the opportunity and the man. That's what I would tell him.

I'd actually probably, knowing me, I'd probably say, hey, why don't you tell a successful mentor guy to have coffee with me? I got questions. That's probably what I.

Successful mentor guy.

I'd like.

He has a new title, successful mentor guy.

That's what I would actually do.

Like a Saturday Night Live skit.

Yeah.

I'm a successful mentor guy. Yeah, I am.

Yeah. I got questions and I'd like to ask and let's see how he answers it. But that's just me. I do it for sheer sport.

Tim's in Pensacola, Florida. Hi, Tim. How are you?

Hey, sir. I'm well. How are you?

Better than I deserve. How can I help so.

Quick and to the point? I'm debt free. I tithe for my church. The remaining money that I have left over at the end of every month causes me more anxiety, more stress. I don't know what to do with it. And I just watch it disappear. I don't know if it's bad spending habits. I can put money in my TSP, my retirement every month, too. But that leftover money, I don't know what to do with it. And inevitably what I do is just spend it.

Yeah, of course you do. That's what everybody does. Yeah. It's not horrible. It's just not efficient. And the lack of efficiency is bothering you and giving you regret itis.

Yes, sir.

Yeah. So it's a very simple fix. Start doing a detailed budget using the everydollar app. I will give you the every dollar app premium version that for free. That ties into your bank. So every time you spend on your debit card, you have to drag it into a category in your budget. Now, the trick here is this. John Maxwell. Ken and I have a good friend says that a budget is people telling their money what to do instead of wondering where it went. That sounds just like you.

Yeah.

Okay.

I would agree with that.

So you need to tell your money what to do before the month begins. Give every dollar an assignment. That's why we named the app. Every dollar. Every dollar has a mission. Every dollar has a name on it, however you want to call this. But every dollar is allocated on the app has. Has an assignment before it comes in. And if the assignment is below this $50, then blow the $50. If the assignment is put more money in an investment than put more money in an investment. If the assignment is find someone and do a random act of charity and give somebody $50 at a gas pump, or leave a $50 tip at the Waffle house, then do that. Okay. But write it down ahead of time. And whatever you're doing, do it on purpose. And then if you actually follow the plan that you made for yourself, then you will not feel regret. Does that make sense?

It does.

You've got a plan for most of your money. It's the little things that are the little foxes. Spoil the vine proverbs says, yes, sir. It's just I hear what you're saying. You're being very responsible and detailed with a whole lot of your money. You told me where it's going. It's going to tsp, it's going to this. You've got it laid out. But I just want you to add a level of project management, a level of detail to your planning of your money. And when you do that, you're going to get a sense of relief. You're going to feel like you got a raise, and you're going to be able to achieve some goals with that money. Because I really don't care what people do with money as long as they do it on purpose. As soon as they start doing it on purpose, then they come back and ask me, okay, what do I do next? And that's where we came up with the baby steps.

Yeah, you could just feel a little angst on him still. And it's because I don't know if he's feeling like he's doing enough good with it or what's going on. But regardless of that, to your point of confidence. That's right.

That's where the angst comes from. That's right. You will get confidence. When you start telling your money what to do, you'll start to be going, I'm a money stud. I got this going, man. Right. You get. You. You got. You just. I got this. Because you're gonna. Cause all this is, is you feel out of control, you feel chaotic, you feel like a failure. Yeah. And when you start putting it down on paper, and then you live to the paper, start putting in the app, and you live to the app. Ding, ding. You know, successful. It's called self discipline, and it's amazing what that does to people's dignity, self confidence, power, everything. Their swagger comes, everything. You're just gonna feel a whole lot better about Tim. Tim. So have at it. Kalin is in Sacramento, Kayla. And I'm gonna hold you till after the break because I'm looking at this number here and don't want to have to.

Yeah, I wanted to go back to that Tim thing because you said something really great earlier in the show about those buckets of when you've done everything that you're supposed to do and you got this extra money, it's that give some of it, you know, save some of it, have some fun with it. And again, by going through that budget exercise and using every dollar, it's the intentionality that I think he's craving to where he can go, okay, at least I have a plan for. It feels like he. He doesn't have a plan right now, which the budget addresses, and therefore, he's just kind of like, ugh. The inefficiency, I think, is eating away at him.

Listen, there is no. Even if you're the most free spirited person in the world, there is no one who gets peace from disorganized chaos. No one. Oh, that's fine. No, it's not. You know, you wake up feeling like you got a financial hangover, you look over, and you go, oh, God, I did it again. I overspent. Oh, God. I shouldn't have ordered those 73 extra things at the restaurant. Ugh. I did it again. No one. That's not fun for anyone. I don't care. You don't have to be a nerd or a tight wad to have that experience. Every. No one gets peace from disorganized chaos. This is the Ramsey show. Ken Coleman. Ramsey personality is my co host today. Thank you for joining us. Open phones at 888-25-5225 Christian's in Lexington, Kentucky. Hi, Christian. How are you doing?

Good, how are you?

Better than we deserve. What's up?

So I just recently lost my job. A couple months ago, my job, I was making 80,000 at my new job. I only make at a max 24, 25,000 a year.

You went from 80,000 to 24?

Yes.

Why?

I was a truck driver. I was on the road a lot. And my daughter just turned a year old and I just want to. I would rather be at home with her and my wife than be on the road 8 hours a week.

Yeah, but what's the $24,000 job you just took?

It's at a automotive collision repair.

Yeah, you can. You can drive in town CDl and make a whole lot more than that.

Yeah.

What's going on? You just acknowledge that, you know that drivers are in huge demand, you've got incredible qualifications, and you just said, yeah, what's going on?

It's not something that I love to do. I was miserable.

Doesn't matter, brother. Right now. You can't take that big of a hit. What's that going to do to your.

In your $24,000 a year, man, you move to poverty level. That's right.

Have you run the numbers on what that's going to actually mean?

No.

You're starving to death. That's why you're calling.

Yeah.

Yeah.

You have an income problem. Okay, so you first. You said you lost your job.

Yes.

Did you get fired?

I did get fired.

Why?

The company that I was at has a point system and you have so many collisions or drop trailers. One was a mechanical problem, but it still went to wind two points and the other one was a collision.

Okay, so is that going to keep you from getting another CDL position?

No.

Did you get hurt in the collision or did someone get hurt in the collision?

No, sir. It was in the parking lot, a parked car.

Okay, so I'm trying to figure out, was your confidence rattled?

My confidence was not that rattled. It was a freak accident.

Yeah, I mean, so that's why they call them accidents. I'm fine with that. I got no issue with that. What I'm trying to. So you're not afraid to drive a truck and you don't. And you think you're capable of driving a truck and you could make $60,000 in town. Instead you're making 24 schlepping parts and be home every night. You do know that, right?

Yes, sir.

I mean, you do know that's what CDL drivers make with in town routes, right?

It is from one of those at that company.

So, Christian, let me. Let me tell you why I think you've got to take this. This option. Well, it's a viable option. This is not long term, but it will. It will. It will stabilize you while you figure out what the next is.

Well, let me ask you this, too. Let's stop a second. Let me back. Pan back three more steps. How old are you?

28.

Okay, so what do you want to be doing when you're 38? That makes 100,000 a year.

What I'm doing right now.

That. What you're doing right now doesn't make $100,000 a year, dude, you make 24. There is no path to 100.

Well, I'm detailing cars, and I would like to start my own business, and that's where I would like to get to.

Okay, I'm. Now, I thought you said you worked at an auto parts store.

Yes, sir.

Not.

Not a store. A collision center.

Oh, so you detail them once?

So you're what? You're washing cars in a collision center?

Yes, sir.

Okay. All right.

Okay. So let's talk that out. So, if that's the path to one day owning your own detail business, you have to make more money and get out of debt and get free of all of the junk that comes with the debt, and then we can start. Start taking steps to starting your own business down the line. But you working in this current job in detail.

Do you know how to detail a car now?

I'm sorry?

Do you know how to detail a car now?

Yeah.

Yes, sir. That's what I was.

If I hired you to come to my house and gave you the equipment, you could detail my car and you could charge me $135, right?

You wouldn't have to give me the equipment. I've got the equipment.

Okay. Why aren't you doing that, then?

I am doing that on the side, but the demand on where I live outside of Lexington is not that great. And there are many companies that detail cars in Lexington that people would rather go to.

Okay, so we have a bad business idea. The market where you live doesn't support this now or probably in the future, correct?

Yes.

All right, so gotta have some gumption here. We got to say. Okay, what do I love about detailing? What gives you that joy about the detailing process?

I love working with the customer and seeing them happy with a completely brand new looking car.

Okay, great. So here's what you've got to do, you've got to start thinking, how can I meet people, everyday life and do something for them that makes them really, really happy? That could be in the trades, my friend. And the trades, there is a huge need right now. You've got to start looking at what you can do that still brings you enjoyment. And so this could be plumbing, electrician, you could get into construction. And let me tell you this, there's also manufacturing jobs right now all across this country where you could potentially be working with customers and doing something for them because you didn't say it was about the car so much as about doing something, making it look something good and handed off to somebody and they get excited about it. You've got to start channeling that and realize what your opportunity is. Here's what I like about you. You want to work for yourself one day. That's great. And I think the trades are where you need to be looking because there's a greater market for you in and around Lexington, Kentucky than this detailing business.

Okay? So here's a couple of things I do know, all right? I do know you're starving to death. Your current job sucks. I'm a hundred percent sure your family is in jeopardy. You went from eighty k to twenty four k and you called us because you can't pay your bills and you're scared. So we're trying to help you with that. And dude, you need to go get something else and make some more money on a temporary basis while you get some business idea up and running. If it's not this one, it's another one. But I can tell you this, anytime you're doing something with your hands, like car detailing or building decks or working in the trades, if you show up on time, do what you said you were going to do every single time, you can charge almost anything you want. And there really is no competition because most people can't even seem to get there.

We aren't starving the best. When I had that dog, we were living on way less than we made. But what? We may run into two vehicles that we can still afford but don't want to.

No, you can't afford them. You're broke. You're not making money. You need to get a different position, son, your income is your crisis. And, you know, and it's because you, you know, if you've got the equipment, you either need to get that equipment and haul your butt over to Lexington and get some cars washed and get your income going, or you need to go take a job driving Cdl inside your family's depending on you. You got about 20 minutes. Ready, set, go. Now. Now, your analysis of going from 80 to 24 and I'm going in the pressure washing business, the car detailing business, but I really can't do much because I live out in the country is bull crap. It's killing you. It's killing you. You need a new set of eyes on this and you need to get in gear and make some money for the next year and a half to two years and get the wolf away from the door, get these stupid cars sold, and then you can start making some adjustments long term in your career. And you either go one of the directions, Ken said, or you can go beat the competition in Louisville and say, well, I don't drive over the road 80 hours, but I do drive to, I mean Lexington.

I do drive to Lexington, or we load up our butts and we move to Lexington where the business can prosper. One of the two we can't make it out in the country. We're moving to town, boys and girls. Here we go. This is what you do. You make your family work by working. This is the Ramsey show. Listen up. Trying to reach your money goals without a rock solid budget is like trying to climb Mount Everest in ice skates. It isn't going to work. That's why we built the every dollar app, to help you win with money. It's the simplest, most straightforward way to track your spending and give every dollar a job. That way, you can stop letting your money push you around and start reaching those money goals. Download every dollar for free on the app store or Google Play. Ken Coleman Ramsey, personality, is my co host today. Thanks for hanging out with us, America. Well, I don't know when you're going to be listening, but today is Tuesday, the 21 May. For those of you listening live tonight, George Campbell and I will be doing the first installment of two nights in a row of Dave Ramsey's investing essentials.

I'm going to get nerdy and go deep down into the nerdville of investing, stuff I've never taught before. But people have been asking me how to analyze real estate properly, and I'm going to teach you the academic version of it. And what I actually personally do on real estate and, and what I do on mutual funds and what I do on other things. And what are the principles I use and what are the principles for investing that I find with wealthy people versus, you know, your broke brother in law who lives in his mother's basement and has a tick tock account, which everybody has, seems to have an idea about finances that are broke. So we really don't take financial advice from broke people. So we're going to go through this tonight and tomorrow night. It is not. It is not two separates. It is a back to back. And so you want to be there for both nights. If you're hearing this in time, you can get the tickets for $199. Gosh, Ken, I can't believe it's thousands of people. Yeah, I can like 4000 people have signed up. It's crazy.

Yeah, I'm not surprised. This is what people want to hear from you.

You know, apparently ramsaysolutions.com events, they may regret it, though they may be sleepy by the time I finish my nerd explanation. This is the kind of stuff that I dread somebody doing in a live audience because they nod off right in front of you.

You should make George come out every 15 minutes and lead them in jumping jacks just for about a minute and then let you get right.

Because George is known for his aerobic activity.

No, I just think it'll be funny.

Yeah, that would be funny. Yeah. George is going to help me and that will make it lighter than if.

That's going to be really good than.

If I just crunch the academic crunching.

That's right.

Gordon is in Tampa, Florida. Hey, Gordon, what's up?

Hey, Dave. How you doing today?

Better than I deserve, sir. How are you?

I'm all right. Could be a little better.

Cool. How can we help?

So I have been having a little bit of trouble getting my wife on board with the baby steps and kind of, you know, getting started with financial peace University. And I'm trying to see what I can do to get her, you know, kind of on board with the idea. How old are you talking about our debt situation.

How old are you?

30.

And how long have you been married?

We've been married for 13 years.

And how long have you been discussing Dave Ramsey and baby steps and Ken Coleman?

We have been discussing it here and there over the last couple weeks. I've been trying to get her on board with it.

Got it. Okay.

She's a little skeptical.

Yeah, I bet. Because you came in and started telling her all the things you were going to do. Well, I tried to screw this up. I know why she's not on board. Because you came in and started telling her, here's what we're going to do. This is awesome. I'm so excited. We need to do this, this, this and this and this. And Dave Ramsey said this and you've already turned my name into a cuss word in your house, didn't you?

Not exactly.

Okay. Then what did you do?

I.

Why do you think she's not on board? Why do you think she's not on board? You think she has a character deficit?

I honestly think she's kind of set in her ways of doing things her way.

Yeah.

To be honest. Yeah, I've tried to, you know, just simply.

You've been married how long did you say? Ten years.

We've actually been together for 13 years. We've been married for eight.

Okay. And who handles the money in your house before all this happened?

She does, because I'm at work for 16 hours.

Can you imagine that you coming in with bright money ideas might be a little bit insulting to her.

Yeah.

Yeah, I can. And I've also tried to talk to her about that.

Yeah.

What's the part she's most hung up on?

Well, she has a plan as far as going through the snowball effect, and she feels like it's going to work, but it's also the same plan that she talked about several times prior, and it didn't work. So I. That's why I tried to suggest, you know, the baby steps and try and get her to at least look at it. That way we can talk about it together. And as soon as I bring it up to her, she completely shoots it down. So.

What'S her version?

She's telling me it's more. I have to be a little more faithful, as far as, you know, looking for faith, if I want to word it correctly. She's been on more of a spiritual journey lately, and she's telling me that I need to be a little more optimistic to that kind of thing and have a little more faith on my side instead of just, you know, kind of being distraught about the whole situation, which I told her I can understand. But the thing is, is it's all real happening right now, and it's very frustrating mentally, because I am the only one working at the moment.

Why does she not work?

Well, she was working, but the daycare service was so expensive that I just said, it's almost easier for you to just be a stay at home mom, and we can save the $500 a month that we were paying and put it towards the stuff that we were paying off. And we agreed on that. And she just recently started working about a week ago, but it's only Saturday, to kind of help with the debt and pretty much everything since inflation started, just like everybody else has pretty much where? The downfall.

What do you make?

As of my last job, prior to being laid off, it was 60 grand a year.

Okay.

I just started a new job last week, so I don't even have my first paycheck until this Friday. But I'm just gonna rough plus or minus around 60 grand.

Okay. And where does 16 hours a day come from?

Well, that was at my previous job.

Okay, good. So now you're not. Yeah.

Now it's anywhere between ten to twelve. You know, it's kind of depending on.

What do you do?

I'm a construction surveyor.

Okay. All right. Okay. There's. I don't know if you can hear this or not, but what I think I hear going on is a version of what I thought was going on at the start of the call a. She's handling the money and is on a faith walk as a part of that, and you come in with a bunch of new ideas that is insulting to her. And you just saying that out loud once doesn't change her emotion on that. That is a valid emotion as a response to you coming in. She's been handling everything. You. You said, I'm working 16 hours. I don't have time to do it. You do it, and then you come in and go, oh, wait a minute, I don't like the way you're doing it. And that generally doesn't go well in relationships. Dude, it's pretty simple then. Secondly, you came at her with a bunch of ideas rather than a dream. So I would pan back if I were in your shoes and you called and asked what to do, and this is what I would tell you to do, and sit down with her, turn off all the tvs, make sure the kids are in bed, and sit down and say, I need to talk to you about this, and I need you to hear me clearly first.

I'm sorry I came at you wrong on this. I came at you with a bunch of things I think we need to do, and I came at you in a way that insulted what you were doing. I am glad you've been doing what you're doing. And I'm with you on this faith walk. I'm with you on what you're doing. I am learning some things about this money stuff that I've never known before, and it's exciting to me. And the reason. Here's the key right here. The reason I'm excited is here's where I think it can take us. I want us to sit and talk for a few minutes about where we could be if we were out of debt, what would you want to do if we didn't have any debt and we had some money, what would you want to do with generosity with travel? What kind of car would you like to have someday? What's your, if you had, if somebody walked in and hand us a million dollars, what's your dream? What would you want to do? And then let's together figure out the best way to get there. And, and I, and it would mean a, and then you let her then talk that through.

Have a dream date in high definition, and shut up and listen to her when she's talking. Okay? And when you're doing that, then let that all get out there and then go. Okay. Let's now agree on how we can get there after it's all out there. And I'll give you financial peace university for the two of you to go find a local church and go together. And that is a faith walk, by the way, to learn God's ways of handling money. That's what financial peace university is. And then you say, it would make mean a lot to me if you would consider looking at this live from the headquarters of Ramsey Solutions. It's the Ramsey show, where we help people build wealth, do work that they love, and create actual amazing relationships. Ken Coleman, Ramsey personality, is my co host. Thank you for joining us, America. Open phones at 888-25-5225 Jerry starts this hour in Austin, Texas. Hi, Jerry. How are you doing?

All right. Dave. I screwed up.

Uh oh.

So I am driving a 2021 Nissan that I bought during the chip shortage. I am about eleven grand upside down on it, not in a position to get a loan, and the transmission on it just completely failed. Nissan is quoting me right at $5,000 for a transmission, and I don't have that. I don't know what direction I need to go in because this car is kind of my source of income at the moment. I'm between jobs, so I just. I run delivery services.

How old are you?

36.

Single?

Yes, sir.

Okay. What do you owe on the car?

Today's payoff would be right at 23,000. The dealership offered me 11,000 last week. I could probably get 13 private sale if the transmission wasn't messed up.

They offered you eleven with the messed up transmission?

No, that was right before the transmission failed on it. They. They hadn't test driven it or anything. So it was sight on scene. The transmission went out while I was on a delivery a couple days ago. This last weekend?

Yeah. Do you have any money.

At the moment? No, I just paid off all of my credit cards and everything. I started following baby steps probably right after I got this car.

So you have a $1,000?

Yeah, about that, but I don't know. Yeah, that's not enough to even.

I didn't ask that. I asked what you've got.

Yeah, I have my thousand dollar emergency fund, and that's pretty much it.

Okay. Pretty much? What's pretty much mean?

I mean, I could probably scrape together another couple hundred bucks just from, like, side work and friends that I have and stuff like that.

Okay. All right, all right.

I'm digging deep here on this idea. Jerry, do you have any friends at all that are very mechanical? They work on their own cars or a friend of a friend?

I am a mechanic by trade. But the car is so new, no transmission shop in town offers a rebuild service for it. It's a dealer only item. So the price that needs the Nissan dealership gave me, that's about as cheap as I would be able to get it.

Yeah, but that includes labor. Or is that just the. Put.

The transmission itself, that's just parts, is $4,500 before tax.

Wow. Okay, well, that kills.

The idea I had there said it's a 2021.

Yes.

Okay. That's four years old. Three years old. I don't know why you wouldn't have a rebuild out. There's rebuilds out there on four. Three year old transmission.

Yeah. The part that they're quoting me for is a remanufactured transmission because they no longer sell the new one. They discontinued it because there are so many issues with it.

That's helpful. Okay. A lot of joy. A lot of joy in this car. Okay, well, you know, the obvious other answer, then, is a salvage from a salvage yard, a used one. And you go pick that up for a couple grand, and you roll up under there and stick it up under there. That's what you're gonna have to do. And I don't. The problem is, I don't know, while you do all this, what you're doing for money, for food, because you don't have any money, and I'm trying to figure out how to get you a little bit of income coming in while you're doing that.

Yeah, I mean, I was probably making seven to $800 a week running doordash and delivery services, and that got knocked down to zero real quick.

Yeah, yeah, yeah. Okay. So I guess I'm looking for a buddy that's working construction that'll pick me up and take me to the job, and let me make $20 an hour, or you're walking down to target and making dollar 20 an hour for the next few weeks while you're go find a salvage transit transmission from a junkyard. A salvage yard. Don't call them junkyards anymore. And I do.

I do have a bicycle so I can get around, but I also live 20 miles from town because it's cheaper.

Yeah. Okay. I mean, you may have to do some temporary things that involve some temporary help from friends. Do you have any family in the area?

No, sir. I was a ward of the state when I turned 18.

Okay. All right. I tell you, here's. Here's the only thing I can think to do to help you is. Yeah, that's how I would solve it if I were in your shoes. Okay. I'm gonna try to create some income that is legal, hook or crook, with a friend taking me to a job site or, you know, getting wherever. And then I'm going to scratch together a salvage yard used transmission. I'm going to roll up under there since you know how that's good news, and bolt that thing on. And then I think you need family in your life. And so I'm going to introduce you to some. We're acquainted with several churches in Austin, Texas, that love helping people and with no obligation, no weird requirements on your part. They just love helping people. And I'm going to hook you up with a couple of different folks there and through our team and see if we can't get somebody to give you some rides to work, some work, maybe a little bit of cash to get through this little tight spot here.

I'm going to throw an idea out. Jerry, tacking on to what Dave said. If any of these churches, Dave, have a program like our church that we go to locally, where they have local mechanics that go to the church that fix up cars for single moms. I wonder if we've got a church friend where cars are being donated. He trades some work, some extra hours, and he fixes up a clunker that he can use for this season until he can get. Until he can get through this. Because we got to get you a set of wheels, or you're going to have to bicycle to a mechanic shop, because if you're a mechanic by trade and you told us that that's your best money making opportunity right now, and.

They'Re hiring like crazy all the time, so a lot more than you're making with doordash, so. And you don't have to run your car in the dirt that's right. To go be a mechanic during the day. So, um. Yeah, so those are some ideas. You're definitely in a pinch, Jerry. I feel for you. And the only way I know to do is to get family around you, and that's the family of God. Yes. And so you hang on, and christian's gonna pick up, get your contact information. And when I get to a break a little bit later, I'll give you some names, christian, to get to him, and we'll plug you in with some good churches there in Austin, Texas, and get you some help, brother.

Yeah.

That's the only thing I know to do, because you got to have somebody put their arm around you right now. You're by yourself and you're stuck, and somebody just needs to love you, and we'll help you do that. Okay. This is the Ramsey show. It's the last call for our two night virtual event, Dave Ramsey's investing essentials. It's set for may 21 and 22, and you do not want to miss this. I'll unpack my personal playbook on investing and real estate and show you how you can feel confident in your investments, too. Tickets are 199. Snag a vip ticket, and you'll get two sessions with a Ramsey preferred coach. You can join from anywhere. Go to ramsaysolutions.com events and get your ticket today. Ken Coleman, Ramsey personality, is my co host today. Thank you for joining us, America. We're glad you're here. The best way to take control of your money is to do it on purpose. The best way to do it on purpose is called a budget. The best way to do that is the world's best budgeting app called every dollar. You could keep a pulse on your spending. You can make progress.

You can follow along with the baby steps. You can paycheck plan out where every dollar of every paycheck and every month is going. Download the Everydollar app for free in the app store or at google Play or@everydollar.com dot. Heidi is with us in San Antonio, Texas. Hey, Heidi, how are you?

Hi. I am good. Thanks for taking my call.

Sure. How can we help?

So my husband and I are nearly done baby step two, and we have a rental property in a desirable area of downtown San Antonio, and he would like to hang on to it for a couple more years and build some more equity and have the market be a little stronger. And I feel like I want to sell it now and pay down our primary house mortgage.

Okay. Why are you wanting, why do you want to sell now.

Well, I want to sell now because I've been running it as an Airbnb for the last year and a half, and I am managing it and cleaning it and doing all the work for it, and we're kind of just breaking even on a good month, maybe. I'm taking home $1,000 after all the.

Expenses, because the payment on it.

Yeah. Because of our mortgage hospitality tax, you know, supplies and.

Okay, so, you know, that's a completely different thing than we disagree over whether we ought to sell our rental right now. You know, you're saying we're not making any money and I ain't cleaning this thing for free anymore. So what are you going to do, bubba? And he's saying, oh, I think we should think, hypothetically about keeping this rental property. Yeah, well, you ain't got a maid anymore. That's free. I just quit.

Yeah, well, he thinks that there are, like, you know, maybe we could find somebody that could clean it and. And that's a possibility.

But you're not making any money on this house, right? This house is not a blessing. It's cursed. It needs to go.

Oh, man. Okay, what about, like, switching back to long term renter?

Well, you're gonna lose money if you can't make money on Airbnb, you can't make money on long term. Yeah, Airbnb ought to be cash Cowan. Yeah, it's a pain in the butt and it destroys your house, and I hate it, but it ought to be making money. And if you can't barely break even with free freaking labor, you know, on Airbnb, you're not gonna make money on it. You're gonna be losing. You're gonna be writing a check to own this thing every month. Good Lord. That sounds awful.

Okay.

Right? Yeah.

I mean, that's kind of. Well, that's where I've come to. But then when we started, we talked to a real estate agent, and, I mean, the market is just very slow right now. And, you know, I think that's his thinking. Let's give it another year, see if things pick up.

Well, yeah, that's great. If you're not writing checks, I'm putting it on the market. You know, go. Go to ramsaysolutions.com and click on elp for a trusted real estate agent that we have vetted, that knows their stuff and that is high octane, high protein. And I'm getting this thing on the market. I'm getting it sold because I got to tell you, I lost patience with this property, and I don't even own it.

I love the house, though. That's the. You know. You know it. We do.

Yeah, but the house. But the situation with the house sucks.

Yeah.

It loses money, and it's a pain in your neck.

You've had it with this thing.

You're tired of screwing with it.

By the way, a year, two years isn't going to make that much difference in the value. So just playing out the numbers, it's just not worth it.

Yeah. I mean, you're not going to have people lining up around the block. But I think the house will sell. Houses are selling in San Antonio. The market is not so slow that nothing is moving. It's just not white hot. Like after the pandemic where people were lining up around the block. 80. 80 offers over the weekend, but yeah. Yeah. I'm afraid your real estate agents sound a little bit like eeyore to me. I think you need to get, get some other opinions, because I think San Antonio is a fine city, and I think it's thriving. I don't have a read anything. I haven't. I mean, we come out there all the time. We love the city. It's always been good to us. I've not read anything that indicates that city's not doing anything but booming. Unless you're in some kind of junkie but neighborhood with this house or something, then that's different. But that's a neighborhood thing. That's not a marketplace thing. I mean, you're not. You're in an area that's highly attractive. It's a great town. And so in freaking Texas, you know, I mean, this is where people are moving. Texas, Tennessee, and Florida.

That's where all these people that are escaping, these refugees from these other states are coming. So I really, I'm. I think you. Can I go to ramsaysolutions.com? and I would interview two Ramsey trusted real estate agents, both of you and your husband. Interview them and talk to them. And you need to explain to your husband you're tired of doing this, and it doesn't make money. Real estate should make money, and you borrowed too much on it, so it doesn't make money because of the debt. It is a curse. It is not a blessing. Dump this thing. That's what I would do. I'd be done with it instead of maximizing the asset. Yeah.

Shaw had resigned from property management and made and make him do it for about a month. I bet he'd get in alignment pretty fast. Oh, just say I'm done.

Yeah.

Here's you want it to keep it.

Here, you have to take care of the broom. I changed the Airbnb email to yours.

I think that's what I would do.

It's let you, man.

It's not passive aggressive.

Hotel over here.

Great. Aggressive. Right there.

Hotel.

There's a lady in the lobby that likes that call. See, if he wants to hang on to it, then he has to take care of it. So that's. That's what I'm hearing.

Hmm.

He'd last about two weeks.

That's brutal. No, I hope just the whole idea of it'll be enough. That's it right there. I'm done. Wow. Ben's in Greenville, South Carolina. Hi, Ben. How are you?

Hey, Dave. Thanks for call, taking my call.

Sure. How can I help?

So me and me, my wife are newlyweds. Well, it's been a year. We just had our. Celebrated our one year anniversary.

Congratulations.

We have so far paid off $15,000 of our debt. We have 30,000 left. I just got a full time job where I'm making around $55 to $60,000 a year. This 30,000 is divided equally between my car, her car, and one credit card.

Okay.

I have.

This is all stuff you all brought in. You brought all of this into the marriage. I hope.

Her.

Her car we did purchase because her old car was a junker, and she started getting into childcare where she was going to be driving kids around, and she needed something with AC, and we. We probably overspent. We overspent and could have gotten something a little cheaper, but thought that we could do it, and I don't think we could.

Is she making money now?

She's working as a nanny, but we have our first baby on the way, so we. So she's about to be out, at least for a little while, about three months. We wanted to stay home. I have my debt. My grandparents set up two separate 529 college funds that I have not used.

Why?

And it's about $40,000. Be a 10%.

The student loan. Wait a minute. The student loan. None of them are yours?

No. These are 529 college funds. I don't know.

You don't have a student loan? You didn't you tell me so. She had a student loan.

Two cars, one credit card.

Oh, I got that wrong. Okay, yeah, cash it out. You're going to pay a penalty, but you don't have a use for it. You're out of school, you're gonna pay a penalty, but you're only paying a penalty on the growth. So yeah, get with your tax person, cash it out and pay off your debts. Be debt free today. Get moving on it. If you want the tax advice to see exactly what it's going to look like, make sure you set the tax money aside. Find a tax person that we endorse@ramseytrustedamseesolutions.com. and look for tax elps.

Listen, you've been asking for it and now it's finally here. So stop what you're doing, pull the car over and head to ramsaysolutions.com store right now because we've got brand new Ramsey merch. I'm talking t shirts, dad hats, yetis, and even a debt free sweatshirt right now available only at the Ramsey store. That's right. You can wear your debt free scream and rock your favorite davisms, like, better than I deserve. And I included my personal favorite. We've got food at home. Your kids will know better than to ask once they see that shirt. So go check out all the brand new merch@ramsaysolutions.com. store today. That's ramsaysolutions.com store.

Ken Coleman, Ramsey personality, is my co host today. Phones at triple 8825-5225 you jump in, we'll talk about your life and your money. Julie is with us. Julie is in Detroit, Michigan. Hi, Julie. How are you?

Good. Thank you so much for taking my call.

Sure. What's up?

I have a question. I have a question that I have, I have honestly never heard a call or have, and it is a serious question, and I'll explain why. But my question is, is giving excessively the same as overspending?

No, but they're cousins. Tell me what's going on.

Well, we were very fortunate. I grew up, really, without having virtually anything. And so as an adult, I just feel very fortunate. I'll get three eyed. And so I am gazelle intense about wanting to give. So I'm always giving. But my goal is to get rid of the mortgage so that I can give. And we're high earners. But at the end of the year, I will have what I think I need. And it's really more of a cash flow issue. But I will, you know, even the spring is a good example. And it just stresses me out that I will use the, we do have a credit line for work.

How do you, how do you define it? You have a credit line. What? Say this again.

I know. Yeah, we have a credit line for work. Just, I don't know if that's the technical term, but whatever your work.

So you have a business?

Yes, we have a business. So.

So you don't run your business debt free?

I have in the past, but even this year, like, I think I've made it a year and a half or two without, but now I'm back on this year, and it. And it is a cash flow. So, like, right now, my receivables are the same as my credit line because the jobs that we thought we would have going right now don't start until later.

It's a separate. It's a separate issue. We'll come back to that. All right, let me just start with that. Let's just start with that. Stop that. Okay. You need to start running your business. You need to start running your business with more margin. Quit taking so much home and quit giving away so much until your business is able to support itself and you become your own credit line. You need to build retained earnings in a business to where you have some cash slush sitting in the business to cover your ups and downs of cash flow needs. And you're running this business up to the wire because you're taking it all home, and then you're having to dip into the credit line because you got no margin.

Exactly.

And so you need to keep. You got to keep your. It's not healthy business practices. You need to keep some retained earnings. So a percentage of your profits every month from today forward should go to retained earnings, never to be touched. They're just sitting there in the business. And if you get $2 million in return earnings, then you can bring some of them home. But take some percentage and build. Build an emergency. Build a retained earnings fund at work. Start doing that now to do away the credit line. Now back to the other thing. Define giving excessively by your definition, constantly.

Thinking about giving, and not literally on a daily basis, not in any.

That's not giving obsessively. That's not giving excessively. That's obsessing about giving.

Maybe that could be.

That's different than giving excessively.

Right. It's like, I can't. Well, it's both. I do a lot of giving.

Okay.

I just.

What is your. What you said, your big income earners. What's your household income?

Last year was 470, and the year before that was 540.

Okay. I would define giving excessively as you were giving, actually giving so much money away that you're harming other parts of your life.

Okay.

Excessive isn't a dollar amount. It's a percentage.

And I think the percentage is the problem.

Okay. What percentage of your income do you give away?

And that's why I printed out a profit and loss. But I'm like, I don't. That's my problem. I don't know. I know that, like, for taxes, like, I know in my mind, I need over six figures, obviously, for. For taxes because we're an s corp. So I have to pull that. And then I try to think in that, like, I know I need, you know, let's say under 100,000 per month. So if I have 200,000. So last year, my retained earnings before the summer, if I'm looking at it from year to date, was probably 373. So this year, or at the end of the year, then I had close to 300,000 that I thought, oh, no, I had 160. And I thought, okay, I have enough to get into next year. And that was after all of my giving. And however, no, because the job, I.

Ask you what percentage of your. Of your income are giving? And you went on this rambling thing about your retained earnings, because I don't.

Know what the percentage is. Like, that's what I had. I said, I want to be so.

It'S not excessive and it's not obsessive. It's. It's, it's not. It's not. You're not. You're not doing it on purpose. You're just randomly giving money away and you feel like you're out of control because of the chaos.

Yeah.

Yeah.

Right?

Yeah. Okay, so I gotta ask, different than overspending, is there some sense of guilt?

What do you think is driving this? This isn't healthy. Would you agree with that?

I. I guess to me it feels healthy because it feels good to give. So. But yes, when I don't want to have this issue, like, the last couple years felt great because I.

Here's what. Here's what I'm getting at. I'm not trying to. I'm not trying to make you feel bad. I'm trying to help you.

No, no.

I really think that you've got some sense of guilt and you are trying to give this feeling away. I think there's something going on.

You told me five times you're in a big income earner.

It's like you feel you don't deserve what you've accomplished.

Yeah, that could be. Yeah, that could be.

Here's my point. I really think you ought to.

Yeah.

I think you ought to see a therapist.

How many people need it?

I do.

When you grow up without it, you just know people are hurting.

I know your heart's in the right place. I think this is in your head.

There are people like you were when you were a kid, and you've got a lot of money, and I think you can help them. But the bad news is you're not God.

That's right.

No, exactly. And I do know that. I do know that. So I try to have these. Like I said, I can make it a year without doing that. But obviously, I don't have deep enough pockets that I need to get back.

So here's your, here's your tactical math formula that will help you. And then you may need to sit down and talk this through with your pastor or with a therapist. Okay. In terms of what's driving the tears, okay. Because Ken put his finger right on it. So the. But, but what I would do if I were in your shoes is I would change the business model, how we handle the money at the business to where the business is self supporting because we keep enough retained earnings. You're blending your business and your personal together. You need to separate them very distinctly. You need to have a set of business books at the office. And that when you. When you close the books each month and you have a profit, a percentage of that profit should be set aside for retained earnings. If you do that continuously and you set a. Set aside the proper percentage, and you can do some simple math and figure that out, you will not have a need for a line of credit anymore because you make tons of money. Okay, then everything after you have set aside your percentage for retained earnings is called profit.

And you bring that home. Now, when you bring that home, I want you to start giving every one of those dollars a name with your husband every month. And some of that needs to be generosity. And I. And that's healthy, and that's good. And having a heart for people that are in situations like you grew up in is exactly what you should be doing with money. That's a wonderful thing to do with money and finding some causes and some individuals that you can just take on and help with that money, because you got plenty of money to be generous.

And. And let me jump in.

Let's face it, if you give away 20% of your income, that's almost a hundred thousand dollars a year.

Yes.

Yeah.

And that's what I'm doing. But I also need a. I don't.

Know if you're doing that or not because you're not sure you're doing it.

And Julie.

Right.

I know that.

I do give about that much.

Listen, here's what I want. You to hear Dave is laying this out for me. And you want you get a formula, you have to work on this phrase. What you can give is enough. You got it.

Okay.

What you can give meaning. The formula dave's talking about with some responsibility, what you can give is enough. Gilgit's, you understand what I'm saying?

And if you want to give away 20% of your income, there's nothing wrong with that at all. Yeah. That's not excessive, by the way.

Right.

What's excessive here is the chaos, the out of control, and some of it's coming from a broken place rather. Rather than a formerly broken place that's healed and you want to help others. And that. A couple things to work on there. And it's a really good question. Thank you for calling with it. And way to go. Congratulations on your success. This is the Ramsey show. Our scripture today. First corinthians 1613 and 14. Be on your guard. Stand firm in the faith. Be courageous. Be strong. Do everything in love. Theodore Roosevelt said, courage is not having the strength to go on. It is going on when you don't have the strength. Ken Coleman, Ramsey personality, is my co host today. Thank you for joining us, America. We are glad you are here. Eric is in Boston, Mass. Hi, Eric. Welcome to the Ramsey show. Hi.

Thank you for having me.

Sure. What's up?

Yeah, so, I want to talk about my product. I sell barbershop blades, razor blade, straight edge blades. So the problem I'm having is that I have, I would say, three different tiers of customers. So I have the barbers, which are the final customer, the people that use the blades. I have distributors. The other people that go to the suppliers to buy the blades, they are like the middlemen, and they might have the suppliers that have physical stores, and they sell to the distributors and the barbers. So the problem I'm having is with pricing my product in a competitive market. So the issue I'm finding is that my pricing is similar based on the cost of the product, similar to make a profit, similar to products that are already in the market. So, I don't know. I'm looking for strategies of how to price my product to appeal to these three different levels of customers per se, and make a profit.

Okay. How long you been doing this?

It's been about a year now.

Where are you getting the blades?

Get them from China. And I repacked the blades in a different. In a different packaging.

What made you decide to do this?

I always loved business as I was a child. I mean, I always. I was like 13 years old, I was already making deals and stuff. So I always had a passion for business. I mean, I have a pretty decent job per se, but I just always wanted to do something different and start a business.

So why razor blades?

It's a industry that is growing, is particularly dominated, I would say, by Spanish speaking in my area at least. So I saw a big market there and I can connect with the community. I know how to do like social media and stuff like that. So I was looking at the trends and all that, and I was like, you know what, maybe selling barbershop supplies is a good business. So I went for that and then. Yeah, I'm sorry.

It's okay. No, you're fine. So here's the thing. There's a couple of different categories that you'll find yourself with products in the marketplace. There are products that you, that are unique and therefore really don't have a direct competitor. And then there are products that are homogeneous, meaning they're all alike. And the main competition is on price. That's called, that's called commoditized. If a product is commoditized, if all the consumers looking at, if all the people are looking at price, that's the only differentiator is price. You are in a commoditized market and you only have one way to win and that's price. Okay. Okay. It sounds like you are pretty close to that in this world with what you're describing to me. If you have a blade that is differentiated because of the quality, it will last longer. It would let me, I'm making this up. But if you could buy a blade that had a story to it, it came from such and such a family that have been making it since the 18 hundreds. And their blades are higher quality than the cheapo blades that you get somewhere else and they last twice as long and they sharpen a lot sharper.

Therefore, the customers that are getting a shave are going to love you that much more. You know, this is a differentiated braid. I'm brand differentiating here. You have to different, you have to set your brand apart from the other blades. If you cannot do that, then you just have to compete straight on price. And when you're competing straight on price, that's a difficult market to exist in for long because someone will always come along and play the trump card on you.

And, and that's the challenge that I'm facing. Yeah, because as I mentioned, I buy them from China and I repackage the blades. Now what is different about my blades? Not only that they last longer, which is proven. And they're durable too. But also the packaging is a cylinder packaging that can be used as a disposable for the used blades. Already, nobody has come up with anything like that that I know of.

So. Okay, so you've got two things that you need to market, and it's not price thing. One is I've got a disposable situation here. I can get rid of the blade without get somebody getting hurt. You don't throw it in the trash can and whoever's cleaning out the trash can gets hurt with an open blade. Right. And then two, these blades are higher quality and last longer. And I will put my guarantee on that. And if you do not experience that, I'll give you your money back.

Yeah, yeah, I get that.

So who's, who's of the three groups? Because I was doing some quick research. I don't think you mentioned how different are the three groups that you were talking about and which one has got the best upside?

Well, the largest customer will be the suppliers because they're the people of buy bulk. And that's what I'm aiming for. Now the issue that I'm finding is, I mean, it's kind of a commodity because it's so saturated with other options, and I'm a new blade. So for the customer, the supplier, to be motivated to make a big purchase or even try all my blades, I have to give a competitor price. So it has to be, you know, much lower than the competition, and I might not be making that much profit.

Now how many dollar volume are you talking about doing?

You mean in quantity or per unit?

I don't care. Well, no, quantity. Quantity.

Well, I mean, I haven't had a large cell, the moat. The most I've sold now is like 500 units.

So it's not like, why is the bulk sale supplier the best route? Why not one off? Why not sell smaller volume at greater margin, direct to the barbers?

Yeah, that's, I try that, but I can actually make more money doing that. But it's time consuming. And what happens is that usually distributors go straight to the barber shops and they have different products, and that's what they do for work, that's their living. So it's not financially sound for me to go out there on Friday only to sell blades.

So, Eric, if I was on the other end of the phone and you were sitting next to Dave, and I called in, I said, hey, let me tell you something. I'm in a business right now that to make the best profit margin, it takes a whole lot of time. And if I don't do it that route, I'm pretty much having to price myself out of profitability because my margins are so low. Would you tell me that's a good business to get into?

Absolutely not.

What you just said.

That's essentially what you just told us and not trying to, you know, pooh pooh this idea, but you're a business guy. You've been wanting to do something like this your whole life. This is just not a good business to be in for those reasons.

Yeah. You got to either get your margin up or you got to get your margin up, because what you're describing is no fun. If you, if, when you get commoditized and all you're doing is competing on PrIce, it's a race to the bottom.

Yeah, that's right.

It's very different. And so we do not enter any businesses at RamseY that Are commoditized. I refuse to get into them. I'm not going to compete on price. I'm going to compete on quality and the uniqueness. And so there's only one place you can get a total money makeover. The total money makeover advice is in a total money makeover book. There's not a generic version of it out there except for the pirated versions from China that are on Amazon. But other than that. But the, yeah, but I'm talking about the real world. And so, yeah, that, that, so, dude, you've got to get something that's unique and stands out in your world direct to consumer. The, the subscription model that, there's three or four guys that have done different business models on a very large scale, direct to consumer with subscription, with razors, not straight razor blades like you're doing, but razors. So you've got to figure out, is there some way you can get in with a supplier that wants to carry these en masse? It's a great discussion. That's why we drug it out and enjoyed the discussion with you. I like it, like your spirit.

I like what you're trying to do. And so, but I don't have the answer. You've got to find a way to say, I'm either going to do this en masse at a price point that makes it fun or I'm going to do a smaller volume at a higher price point with higher margins, and then I can make the case for my brand differentiation. And you do have brand differentiation available to you that puts this hour of the Ramsey show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of peace, Christ Jesus.

Doctor John Deloney here. Mental and emotional health challenges, broken relationships. It's all just part of life. But they don't have to define you. The Doctor John Deloney show is here to help. It's a collar driven podcast where you can get practical advice on dealing with anxiety, loneliness, depression, relationship challenges, your kids, and so much more. Listen to questions from our callers, or if you're walking through a tough situation and need some help, give me a call. You were never meant to do life alone, and that's what this podcast is all about. Follow along on Apple, Spotify, YouTube, or the Ramsey network app. Remember, you're worth being well.